18.11.2008

Palfinger cuts back

Palfinger the Austrian based loader crane and aerial lift company has announced a series of measures to scale back production in the face of falling order intake.

They include laying off 91 employees in Austria and putting others on short time working. This will include closing on Fridays, an extension of the Christmas holiday by one week, and – for the majority of the Austrian staff – a reduction in working hours by 20 percent with partial compensation for the missed working hours.

The latest moves follow a reduction in the number of temporary workers during September and October.

The company says that the measures it is now putting in place will still allow it to ramp up rapidly as the market picks up, increasing production by up to 50 percent if needed. It adds:

“In recent weeks, there were more and more signs that additional markets such as Germany and France as well as Eastern Europe, including Russia, and South America would be affected by the weak macroeconomic environment. Against this backdrop, capacity utilisation in production was reduced by half as compared to the beginning of the year.”

Chief executive Herbert Ortner said: “Palfinger currently has a staff of around 5,000 employees with around 1,100 working in Austria. So far we have fully exploited our flexible structures in order to retain our core personnel in spite of the weak capacity utilisation as in case of a recovery it is precisely those highly-trained employees that we will need.”

“However, we now feel compelled to cut down on our capacities and our fixed costs to ensure that we are well equipped for the market situation that is expected for the next months and the year 2009.”

Palfinger says that by retaining over-capacity and the skills to ramp up will produce a short-term reduction in profits, but it says that it is designed to secure the company’s leading position in the long run.

“Recently, we achieved one record year after the other, and at the same time we adjusted our organisational and cost structures to the increased capacity utilisation. Therefore, we are approaching these difficult times from a strong position, and we are determined to get through this situation in the best possible manner. We are aware of the fact that our employees are the central factor of success. This view is also shared by the Supervisory Board and the Palfinger family as the majority owners,“ said Ortner.